CVEN 640:

Project Development:
Methods and Models
Lecture 1: Class Introduction
Spring 2009
Dr. Ivan Damnjanovic
 Teaching
 Tuesday / Thursday 14:30 to 15:35, CE 217

 Instructor: Dr. Ivan Damnjanovic

 Office: 705-C CE/TTI Building
 Office Hours: Tuesday / Thursday 4:00pm to
5:00pm or by appointment.
 Phone: (979) 862-6616
 Email: idamnjanovic@civil.tamu.edu
 Web: http://ceprofs.tamu.edu/idamnjanovic/
 Required Textbook

“Real Options: Managerial Flexibility and

Strategy in Resource Allocation” by Lenos
Trigeorgis The MIT Press
 Prerequisites

 STAT 211 or STAT 601

 Background knowledge in:

 Probability and statistics
 Engineering economics
 Optimization
 Assignments and Exams

 Approximately 6 assignments:
 Submitted in the form of Technical Memoranda
 Graded based on the content and the clarity of
presented information
 Make sure you explain the notation
 If you need to type in formula, you MUST use MS
Equation Editor or Mathtype
 Exam
 Tentatively scheduled for March 24, 2008
 In-class
 Assignments

 Due on specified day before class starts.

 Late submissions w/in 24 hours get ½ credit.

 Submit hard copy only unless otherwise

specified.
 Work individually unless otherwise specified.

 Graded assignments can be picked up in class

or in my office.
 Special Group Assignment 2 - YouTube
 Group Term Paper (groups of 2 -3)

 Steps in developing Term Paper:

 One-page term paper proposal
 Literature review summary
 Proposed methodological framework
 Case study and discussion
 Draft paper using ASCE paper format:
http://www.pubs.asce.org/authors/AuthorGuideJournals.pdf
 Present paper
 Group Term Paper (groups of 2 -3)

 Term paper grade will be based on:

 Validity of the methodological approach
 Confirmation to the set guidelines
 Clarity of the expressions in written report
 Understanding of the covered concepts
 Ability to present the paper in an effective
manner
 More information and timeline will be
provided later
 Aggie Honor Code

Must be adhered to

Violators will handled in accordance with the

Aggie Honor System Process
Grading Scale

A: 90% - 100%
B: 80% - 89%
C: 70% - 79%
D: 60% - 69%
F: below 60%
 Grading Breakdown

%
Class Participation 5
Assignments 40
Exam 15
Term Paper 40
TOTAL 100
Questions?
 Introduction of Students

 Name

 Area of Interest
 Brief Background

 Class Expectations
 Class Objectives

 Describe components of commercial

project development
 Identify and analyze commercial
opportunities
 Explain project development process

 Develop preliminary business and financial

plans
 Identify project performance measures
 Class Objectives

 Identify,
quantify and manage project risks
 Evaluate project real options

 Develop exist strategies

 Develop life-cycle revenue and cost

management strategies
 Analyze project cash-flow and financing
methods
 Develop skills for conducting research
 What is a project?

“A project is a temporary endeavor

undertaken to create a unique product or
service.”

“An undertaking that encompasses a set of

tasks or activities having a definable
starting point and well defined objectives.”
 What is a project?

“A planned undertaking of related activities

to reach an objective that has a beginning
and an end.”

“A unique venture with a beginning and an

end, undertaken by people to meet
established goals within defined constraints
of time, resources, and quality.”
Common Characteristics of a Project

 It is unique
 It is temporary; it has a beginning and an

end
 It has a clear goal and objectives

 It involves a series of activities

 It needs resources

 It is a joint or combined venture

…and we have different type of projects
Apollo Project

OBJECTIVE: LAND ON THE MOON

MISSION ACCOMPLISHED!
More Civil Engineering Projects
…now more revenue-generating projects
Panama Channel
Millau Bridge
 Revenue-generating Projects

 What are revenue-generating projects?

Projects that can create revenue!
Objective: Make Profit
 The concern of this class are the projects
where the major revenue-generating assets
are civil engineering structures.

 What are the common types of such

projects?
 Examples

 Toll Roads, Toll Bridges

 Pipelines

 Real estate projects (housing, office space)

 Power plants

 Transmission lines

 Oil platforms

 Others
 Key Players

 Contractors

 Investment Banks
 Large Institutional Investors

 Public Agencies

 Material and Equipment Providers

 Insurance

 Credit Rating Agencies

 Role of Engineers

 Didn’t
change; plan, design, construct, and
maintain civil engineering structures

 However, those decisions need to be

coordinated to maximize the project
objectives: MAKE PROFIT!